With different outlooks on the success of this model, how do you know if it's the right choice for your business?

The “freemium” pricing model is a great way to engage users without requiring them to pay until they wish to access premium features. With different outlooks on the success of this model, how do you know if it’s the right choice for your business?

Decide if freemium fits your product. I love freemium and focus on it as an investor.It is not for everyone. I see three conditions for its use:

a large, addressable market

the incremental cost of hosting each free user is essentially zero

a clear distinction between free and paid products

— Mark MacLeod, partner at Real Ventures

If your customers want to pay, let them pay. I am a fan of charging right away. Why delay? It’s important feedback (arguably, the only important feedback). I also believe in trials – it makes it clear the product isn’t free and forces a conversion relatively quickly (or not!)— Raymond Luk, partner at Year One Labs

Look to the success stories. Dropbox, Mailchimp, Evernote are the premium brand names doing freemium right. Remember, in freemium, the free product is the product. If the free version doesn’t rock, then the economics don’t work.— Dan Martell, founder of Flowtown.com & Investor